The U.S. Securities and Exchange Commission (SEC) has asked the court to quash a subpoena issued by crypto exchange Coinbase that demands documents related to the crypto markets and personal communications of SEC Chair Gary Gensler. The SEC argues that the subpoena is irrelevant and imposes undue burden.
SEC Asks Court to Quash Coinbase Subpoena in Legal Clash Over Crypto Regulations
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SEC Seeks to Quash Coinbase Subpoena in Ongoing Legal Battle
On Friday, the U.S. Securities and Exchange Commission (SEC) filed a response in the SEC v. Coinbase case. Coinbase has subpoenaed a wide range of documents from SEC Chair Gary Gensler, including those related to the crypto markets, communications with third parties and government entities, investigations and litigations, SEC registrations, as well as his personal communications and pre-SEC work.
In its letter to the court, the securities regulator wrote: “The SEC respectfully requests an informal conference and leave to file a motion for a protective order and to quash an improper subpoena issued by defendants Coinbase Inc. and Coinbase Global Inc. to the Chair of the SEC, purportedly in his personal capacity.” The SEC argued:
The subpoena seeks nothing of relevance, imposes an undue burden on the SEC, and strongly disincentivizes public service. It should be quashed.
The SEC added that the agency “met and conferred” with Coinbase “on three occasions regarding the subpoena but was unsuccessful in resolving the matter.”
Paul Grewal, Coinbase’s chief legal officer, provided context for the situation on social media platform X on Friday. He explained that in March 2021, Gensler informed Congress that the SEC lacked regulatory authority over digital asset exchanges, aligning with market participants’ belief that such transactions were not subject to securities laws. Grewal elaborated that Gensler, both as a blockchain technology professor and in his capacity as SEC Chair, made numerous statements to the public and market participants about this matter.
“Coinbase has asked Mr. Gensler to produce documents concerning those communications because they are relevant to exposing how the SEC’s enforcement action offends the Constitution’s requirement of due process,” Grewal shared, emphasizing:
But the SEC and Mr. Gensler seek to prevent them from coming to light.
What are your thoughts on the SEC’s move to quash Coinbase’s subpoena? Let us know in the comments section below.
